Morgan Stanley downgraded Omnicom Group (OMC ) to neutral from strong buy.
Analyst Michael Russell says OMC (as of late yesterday) had exceeded his his $94 price target and was trading close to its estimated normalized peak earnings level. He expects growth in agency organic revenue, but earnings to lag behind the recovery in advertising.
He says the company's new business trends look strong, but competition is increasing in 2002. He notes he also lowered his ad agency sector weighting to market weight.